Global Islamic Finance assets hits $2trn

Securities and Exchange Commission (SEC), has announced that the total assets under management in the Global Islamic Finance industry had surpassed $2 trillion (N394 trillion) by the end of 2014.

Also, the global Sukuk market, according to the commission, has witnessed remarkable growth since after the 2008 global financial crisis as yearly issuances rose from $15 billion in 2008 to almost $120 billion in 2014.

Disclosing this at the second Regional Roundtable on Non-Interest Capital Market in Sokoto, yesterday Director-General of the SEC, Mounir Gwarzo, explained that the focus of the roundtable was on `Sukuk’’ which he described as one of the most important components of the Islamic financial system.

He noted that while most people identify capital markets as an important source of medium-to-long term capital, few realise the amazing potential of capital markets to serve as a catalyst for financial inclusion.

“SEC is determined to unlock this potential of the Nigerian Capital Market. In particular, we are aware of the need to deepen the non-interest capital market space. This is to enable millions of Nigerians and people of faith to invest savings ethically. Investors worldwide are increasingly allocating their resources into Islamic finance products,’’ Gwarzo said.

He noted that the year 2014 is widely considered a landmark year for Islamic finance, especially with landmark debut of Sukuk issuances by countries such as the UK, Hong Kong, Senegal, South Africa, and Luxemburg, adding that the year also witnessed continued strong interest from key markets of Malaysia, Saudi Arabia and the United Arab Emirates (UAE) and emerging markets like Turkey and Indonesia.

Gwarzo explained that the SEC has implemented a number of reforms aimed at deepening the non-interest capital market, noting that the Commission focused on the regulatory framework, reviewing the rules and introducing new ones.

“In particular, we issued rules on Islamic Fund Management as well as rules on Sukuk issuance. These two legal frameworks have encouraged Islamic product innovation with the registration of 5 ethical/shariah compliant funds and the issuance of Nigeria’s first ever sub-national Ijara Sukuk by the Osun State government in 2013 which was oversubscribed.

“We are also considering modalities for setting up a Sharia Advisory Council as a body of experts to advise SEC and the market on non-interest product and their applications. “There is no doubt that the sukuk market is emerging on a global scale as a viable alternative source of funding, “he said.

The Governor of Sokoto State, Aminu Tambuwal who was represented by the Commissioner for Finance, Alhaji Sa’idu Umar said the state government had since resolved to embrace Sukuk. .